Gold Struggles for Direction

The lack of price movement in bullion Tuesday is in stark contrast to swings seen in the recent past. Spot prices for gold climbed to over $700 in May this year only to tumble to under $570 an ounce by early October. Some observers expect that volatility to resume going forward.

"There will be volatile pullbacks and rises, so be ready for the action," write Julian Phillips and Peter Spina, the editors of the Gold Forecaster - Global Watch newsletter. They urge investors to buy bullion on the dips, but they also warn: "Make sure you have 'trailing' protective stops in place around support levels."

In the official sector, the European Central Bank says it sold 120 million euros of gold and receivables last week, or about 7.7 tons.

Elsewhere in precious metals, spot prices for silver bullion edged down half a cent to $14.045 an ounce, compared to a day earlier according to data from the London Bullion Market Association. The previous day's price marked the highest level since the May peak of $14.94 an ounce.

Shares of Silver Wheaton(SLW Quote) were, however, declining 2.7%, while those of the bullion exchange traded fund iShares Silver Trust(SLV Quote) were off 1.7%.

HSBC Securities more than doubled its price target on palladium producer Stillwater Mining(SWC Quote) to $9 a share from $4.25. The underweight rating was retained, however. The stock was recently off 1.6%.